Realty Income (O) investor relations material

Strategic partnership overview

• Realty Income and Apollo are forming a long-term, programmatic joint venture to provide scalable, repeatable funding for real estate investments.

• The partnership leverages Realty Income's $80B enterprise value and Apollo's $536B insurance capital base.

• Realty Income will contribute a $2B portfolio off its balance sheet, with Apollo providing flexible, reliable capital.

Joint venture structure and portfolio

• The initial joint venture will raise $1B of low-cost equity, targeting a 6.875% unlevered IRR for Apollo.

• The JV portfolio will include about 500 properties, $140M annualized base rent, and a 9.1-year weighted average lease term.

• Realty Income maintains operational control and will earn management fees on 100% of JV assets.

• Realty Income has the option to call Apollo's equity after year 7 and before year 15.

Financial impact and benefits

• The JV provides a new source of permanent, low-cost equity, reducing Realty Income's long-term weighted average cost of capital (WACC) to 6.2%.

• Apollo's target IRR is lower than Realty Income's long-term cost of public equity, making the JV highly accretive to shareholders.

• JV proceeds will fund accretive acquisitions and general corporate purposes, with potential for $1.5B of fully-levered investment capacity.

• The structure allows for expansion into investments outside Realty Income's traditional verticals.